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Java Authors: Pat Romanski, Elizabeth White, Leo Reiter, Liz McMillan, Yeshim Deniz

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Is Oracle Hardware Dead?

No one who’s followed Oracle in the past few years could honestly suggest that their hardware efforts haven’t staggered. In the fourth quarter of last year, for example, hardware revenue was down 3% to $714 million year over year. While total hardware revenue including support stayed stead, the decline in actual hardware product revenue has been happening for some time. This happens at a time when many competitor hardware offerings are in a growth phase.

So, is it the end for Oracle hardware? That’s the big question. There is evidence to suggest that Oracle hardware may be under a process of realignment, however, rather than in the death throes.

Areas of growth

There are a couple of areas in which Oracle is still growing. For example, the Exa- line of equipment (including Exalogic, Exadata and others) has experienced revenue growth. The same holds true for the Oracle Big Data Appliance and the SPARC SuperCluster. This suggests that there are areas in which Oracle hardware still has a fighting chance.

The numbers aren’t great

In 2013 Oracle server revenue dropped 16 percent, year over year. (This is by no means a death knell, especially when compared to similar lines at competitors. IBM saw a drop of more than 19 percent during the same time frame). That being said, there was a significant growth among no-name, white-box vendors; their aggregate growth hit more than 45%. Cisco, a new comer to the arena, saw a growth of almost 43 percent, but that is building on a small base of new products.

But this wasn’t supposed to happen

When MySQL hit the scene in 1995, Oracle was supposed to be gone for good. The darling of the Internet whiz kids was supposed to tear down all of the cash cows. Instead, Oracle eventually languished, but the 2010 purchase of Sun Microsystems (and with it Sun’s MySQL), breathing in new life.

Whether or not this kind of resuscitation can happen on the hardware side of things isn’t certain. The smart money, however, isn’t to count Oracle out just yet. The industry can change on a dime, and Oracle is the kind of company that can make those kinds of turnarounds.


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